Bangalore: India may be the world’s preferred outsourcing hub for information technology (IT) services but if a recent report is to be believed, the country’s own use of IT leaves a lot to be desired.
Continuing its downward slide in the list of economies effectively using IT, India ranks 54 among 134 countries in the latest Global Information Technology Report (GITR) in which China managed to move up 11 places to rank 46.
This is the first time China has ranked above India.
Also See Downward Slide (Graphic)
In the last six years, India’s Networked Readiness Index, or NRI, which is a measure of a country’s preparedness in using information and communication technology (ICT) in the business, regulatory and infrastructure environments, has remained flat. Meanwhile, the worldwide average scores have risen, making India’s relative position look much weaker.
Also See The Full Report
The GITR 2008, which has been prepared by the World Economic Forum (WEF) and business school INSEAD and is sponsored by Cisco Systems Inc., is the eighth edition of an exercise which has been ranking nations on their competitiveness based on the use of ICT. India slipped from 44th rank in 2006 to 50th in 2007 and 54th in 2008 even though its NRI score based on survey data (from 41 indicators) and hard data (from 27 indicators) has remained flat at around 4.03.
“This should be a cause for concern as India ranks 114 in individual usage of ICT,” said Irene Mia, senior economist of the Global Competitiveness Network at WEF. India, though, ranks higher on some parameters including market, political and regulatory environment which are conducive to ICT adoption.
Globally, Denmark and Sweden maintain their first and second ranks respectively, followed by the US (which has moved up one position), Singapore and Switzerland. The report lays special emphasis on broadband, which it defines as any network having at least 1mbps (megabits per second) speed. “There’s a lot countries can do with broadband; it costs much lesser than laying other infrastructure, such as roads,” said Enrique Rueda-Sabate, Cisco’s director of strategy for emerging markets.
The period between 2005 and 2007 saw significant expansion of Internet usage worldwide but India’s broadband penetration increased only by 0.2 percentage points (to just 0.3%) when countries with best ICT practices saw an increase of 7 percentage points (from 15% to 22%).
Reacting to India’s declining position, economic advisor to the department of information technology in New Delhi S.R. Rao said, at least in the government, there are serious initiatives which by 2010 will provide broadband connectivity across government departments and agencies. The State Wide Networks, approved by the government last year, will cover 6,800 locations in all states, districts and block with 2mbps secure connectivity for government-to-government transactions by September.
In another Rs800 crore programme, Common Service Centres with 2mbps network are being set up in 100,000 locations to cover 600,000 villages and will be ready by March 2010, Rao said, even as he admitted that only 19,000 connections have been set up by Bharat Sanchar Nigam Ltd so far. Rao claims that no nation has undertaken a broadband connectivity drive at this scale.
Indeed, this might impact India’s ranking next year but as of now India falls in the second stage of a new five-stage Internet model developed by Cisco. The first stage is called Proto-Internet and has 45 countries. The second stage, where India is placed, has 31 other countries with internet usage rates between 5% and 15%. The third stage is Familiarization, which has 39 countries having at least 15% of Internet usage. The next two stages, Extensive and Intensive where 41 countries are placed, are focused on broadband connections.
Graphics by Ahmed Raza Khan / Mint